Energy, Gas, Legislation, Lithuania

In implementation of the requirements of Article 5 (the version that will come into effect on 1 January 2014) and Article 11 of the Law of the Republic of Lithuania on the Liquefied Natural Gas Terminal, the Methodology, inter alia, provides for the pricing of services of an entity in natural gas liquefying business, which establishes the calculation of an additional natural gas supply safety component in addition to the upper limit of the natural gas transmission price and the calculation of the upper limit of natural gas liquefying service price.

The need for funds for the construction of the liquefied natural gas (LNG) terminal is established after taking into account the financial resources necessary for the implementation of the LNG terminal investment project and evaluating the presented documents, which prove that the company implementing the LNG terminal project does not have a possibility to make use of other possible project financing sources or other means that can ensure financing of the project. The Safety Component is calculated after evaluating the funds necessary for compensating, in full or in part, for the expenses of construction of the LNG terminal, its infrastructure and connection and all fixed operating expenses necessary for ensuring the operation of the LNG terminal, its infrastructure and connection.

The Methodology establishes the procedure of calculation of the upper limit of price of natural gas liquefying service (hereinafter, the Price of Liquefying) by evaluating all variable expenses of liquefying activity.

The Methodology provides for a possibility to adjust the Safety Component and the Price of Liquefying by use of relevant coefficients set each year.

AB Klaipedos Nafta currently performs the functions of the LNG terminal project implementation company and is entitled to the receipt of funds, under the procedure and conditions established by legal acts, intended for compensating, in full or in part, for the expenses of construction and operation of the LNG terminal, its infrastructure and connection.